This is apropos a letter to the Editor carried by the newspaper yesterday. It is increasingly clear that things are much worse in rural areas, which are home to most of the country’s population. Average increase in prices of goods and services there was 42.2 percent last month, compared to 35.1 percent in cities.
The largest and most unforgivable increase has been in the food inflation rate. The price of flour, the country’s staple food, rose by almost 100 percent while wheat also become 95 percent more expensive than a year ago in May. Prices of pulses jumped 58 percent and tea became 113 percent more expensive.
It’s already been reported that the government plans to set the next fiscal year’s inflation target at 21 percent, which is also not going to go too well with the people. Already burdened with the lowest growth and highest unemployment rates in decades, they must also face the kind of high prices that have never been recorded in Pakistan.
And a government that made such a fuss about prices when it was in opposition just a little over a year ago, when inflation was much lower, this could very well be the death knell. For, everybody knows that it’s not just supply chain disruption that is responsible for high food prices, which matter most to the people in such times, there’s also the fact that relevant authorities didn’t do much to upgrade the price control and monitory system, which allowed arbitrary price increases up and down the country.
To top it all there’s also unprecedented political uncertainty, the most potent deterrent for foreign investment. So we’re left with a situation where there’s a very real threat of default yet we’re driving away investment when there’s already no aid and the people have never earned so little and had to pay so much for life’s most urgent needs. This is not a situation that can be sustained for too long. The government needs to find urgent answers. But, alas, it has none. And it is the people, as usual, that must pay for it; this time quite literally.
Hamid Shafqat (Karachi)
Copyright Business Recorder, 2023
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